Microsoft Eyes ASP Business Postmark
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From:Friday, October 29, 1999 10:20 AM +0300
Subject:Microsoft Eyes ASP Business  
Microsoft on paraikaa muuttamassa ohjelmistobisnestään. Tähän asti asiakkaat ovat ostaneet ohjelmistojen käyttöoikeuksia ja päivityksiä niihin kertamaksulla. Jakelu- ja rahastustapa muuttuu kaiken aikaa. Jatkossa asiakas liisaa ohjelmiston käyttöoikeuden esimerkiksi vuodeksi kerrallaan ja maksaa seuraavasta vuodesta uudelleen. Ohjelmapäivitykset tulevat automaattisesti linjaa pitkin. Microsoft tietää tarkasti, mitkä ohjelmien versiot asiakkaalla ja millaisella sopimuksella. Tähän mennessä Microsoft on myynyt tuotteita, tulevaisuudessa myydään palveluja.
Microsoft Eyes ASP Business
Ballmer outlines vision that includes new ‘knowledge worker service’

The Microsoft Corp. that dominates the world's software industry will operate in a much different way in a matter of years, as it transforms its core offering from a product to a service, says Steve Ballmer, president of the Redmond, Wash.-based software giant.
Speaking here at Gartner Group Inc.'s Symposium Itxpo 99 conference, Ballmer described a new software leasing service initiative that he and other senior-level executives are studying. The goal: provide customers a better way to engage Microsoft without always having to buy new upgrades or products.

The new thinking represents a radical departure from how Microsoft has engaged customers to this point. It means more direct interaction with enterprise customers and signals the company's interest in becoming an application service provider (ASP) of sorts, says Tom Austin, vice president and research fellow at Gartner Group.
"If you look at where the market is going to be three, maybe four years from now, you'll see the emergence of the 'Web top.' And many companies are fighting to define and own what they will be," says Austin. "This is the beginning of Microsoft's mission there."
"Our business five years from now, seven years from now, won't look like it does today. We started as a company that made software products," Ballmer says.
But if you cast forward seven or so years, he adds, Microsoft and other ISVs will have to remake themselves as software services company. They won't bill customers by the hour, the way professional services companies do, but they'll be service companies just the same, transforming their software from something that is published, pressed onto a CD and then shipped worldwide into something that has a more fluid nature.

"It has to update and take care of itself. For us, this just has profound implications, on our platform, on the products that we offer, on the development approach, on the scaling approach--absolutely everything has to change and evolve and enhance that vision," Ballmer says.

When pressed to explain what he meant, Ballmer explained that such a shift won't mean transforming its fast-growing consulting arm or its equally fast growing support operation into a for-profit center. Instead, it will mean playing a role in reaching out and directly interacting with customer systems – with each desktop connected to a network.

It will mean delivering an enterprise applications line of business applications. And it will also mean playing the role of an ASP where appropriate.

He says he dreams of a day when he can offer customers a service called the 'knowledge worker service'. We'll take care of it for you. The file sharing. The e-mail. We'll check your software regularly, tune it up for you, and update the software when needed. We'll worry about what hardware you have and make sure everything is optimized for you. Our software has to get to the point where can make that kind of commitment."

Microsoft is nowhere near that point today. The first step will be to build software that customers themselves can run as a service as delivered by IT organizations and complimentary partners. Microsoft says that its Exchange Office product will be the first to meet that need.

As for users, he says the software they look to Microsoft for won't cost more any more than it does today. But rather than buy it, customers will buy it like other services and pay monthly user fees, for example.
As for developing an ASP business, Ballmer says his company won't run servers or facilities per se. Nor will it pull together software as a service from multiple vendors and offer one integrated offering. What it will do is write an application that lives as a service.
"We will be an ASP ourselves for products like Exchange Office. If someone wants to buy the 'knowledge worker service,' we may have partners who can resell and add value. But we also will have direct access to our customers through that application on a network. We need to be an ASP," he says.

Separately, Ballmer agreed to address the concerns of enterprise customers at the event. In particular, he pledged to review any policy the company had, for example, that would limit the ability of customers to publish information on Microsoft's software performance.

In addition, he pledged to provide greater direct support. This year alone, Microsoft will add more than 1,000 new people to its consulting, service and sales staff just to focus on its network-based line of business applications for the Intel-based PC and Apple Macintosh, he says. They won't be for-profit or take responsibility for complete solutions implementation. But, he says, they will play a greater role in ensuring customers get their Microsoft implementations installed successfully.